Deutsche Telekom has taken another prominent step towards business diversification with the introduction of a white label portfolio for the smart home segment.
It’s a smart move from the Germans which could be interpreted as a play on the nervousness of customers who are afraid on missing out on a burgeoning segment. The smart home is another of those areas which has threatening boom-time profits without delivering. In such circumstances research and development can be de-prioritized.
Pushing investments to other more pressing areas would not be seen as a bad move, considering the pressure on the profit margins of some firms, though it does mean a game of catch up when a segment matures. At this point panic usually ensues due to the reality of lost revenues which could have been claimed if an executive had made a different bet.
The Deutsche Telekom white label opportunity does seem to capitalize on those firm’s unpreparedness, offering entry to the market which is ‘quick and easy’.
“Our white label portfolio for smart homes makes it easy for telecommunication providers to enter this market,” says Thomas Rockmann, VP of the Connected Home business unit at Deutsche Telekom. “If companies offer their customers applications including Internet, telephony, television and smart home from a single source, they are sure to strengthen customer retention.
“What’s more, the basic app is an attractive way to generate customer interest in connected home solutions: consumers can try it out over a period of time and then upgrade to a premium smart home version with more functionality later, if they wish to do so.”
The portfolio combines the open Qivicon Smart Home platform with smart home gateways, apps, devices and services. The smart home is a logical move for those businesses who are looking to expand revenues to new segment through value adds and customer loyalty propositions. Telcos will always play a key role in the segment, due to the basic requirement of connectivity, though Deutsche Telekom has pushed itself further into the equation with the new initiative.
The portfolio is currently available in Norway and Slovakia, though it shouldn’t be too long before it is introduced into other markets.
In other news, Deutsche Telekom has also recently pen an agreement with Amazon which sees the telco integrate Amazon’s Alexa voice-controlled assistant into the smart home segment (See Light Reading’s EMEA roundup). The Qivicon smart home portfolio can now be controlled through the Amazon Echo.
The news is perhaps more of a win for the Amazon team that Deutsche Telekom, as the US giant continues its battle with Google for control access to customers. Facebook has dominated access to users in the social media world, and has grown substantially because of it. Controlling the gateway into the customers living room could be even more significant, with Amazon and Google leading the charge for the moment.
Another more damning implication is a lack of confidence in its own artificial intelligence proposition. Like most other technology companies worldwide, Deutsche Telekom has been researching and investing in AI, but handing over the important role of user interface to another brand is a notable footnote.
Telcos are fast trying to justify themselves as more than simply connectivity providers in the new IoT-driven world, but incorporating Amazon capabilities into its own portfolio is not the biggest sign of confidence in its own AI work. If telcos are to be relegated to the role of utility, such decisions to bolster the footprint of brands such as Amazon will be a noteworthy contributing factor.